Offshore Asset Protection Trusts (APTs)

Will an Offshore Asset Protection Trust (APT) provide the protection I need for my assets through retirement if I cannot buy adequate malpractice insurance?" is a question often asked by physicians with substantial net worth. Offshore APTs protect assets from future creditor claims and judgements using foreign trust laws. Certain foreign jurisdictions have favorable trust laws that permit a person to protect assets from creditors and judgements while allowing the person to benefit from the use and enjoyment of their assets. Some features of these trusts are that they defeat collection efforts, discourage frivolous claims, encourage settlement and provide investment consultative services, and are used as a part of traditional estate planning. The risk of being sued continues well into retirement for most physicians.

The limits of malpractice insurance may not be adequate to cover all of ones wealth. Offshore APTs can provide an added layer of protection that traditional levels of protection, such as corporations, partnerships and domestic trusts, can not.

An offshore APT could be appropriate for a high net worth individual concerned about the possibility of being sued sometime in the future. Although individuals with existing claims may not avoid existing claims by setting up an APT, an APT may still be formed to provide protection from future claims. Some individuals who are unable to obtain affordable, adequate or appropriate insurance coverage may be able to use an APT to ensure assets remain available for a future need. When combined with an estate plan an offshore APT can be a successful tool to protect a large inheritance or estate. Also, a non-U .S. citizen may be interested in an offshore APT to avoid forced heirship or other provisions that may otherwise be applied by her or his country.

If you have any questions about offshore asset protection trusts ( APTs ) or other estate planning issues please contact James R. Henscheid, JD, Wealth Management Specialist, Wells Fargo Bank at (515) 245-3115 for a complimentary analysis.